Time to park megaprojects mentality: Energy conservation programs can save all taxpayers money

The Hamilton Spectator: Jack Gibbons - May 12, 2008

It's that time of year. You have dutifully prepared your taxes and wondered where all the money went. When it comes to our electricity system, Ontario taxpayers may be wondering the same thing 15 years from now.

With the province seemingly determined to throw good money after bad on nuclear power while keeping a tight throttle on spending to reduce electricity demand, Ontario taxpayers and ratepayers are being set up for a whopping headache just down the road.

The throbbing between the temples is already starting to grow as the bills roll in from the Bruce Nuclear refurbishment project. Already running anywhere from $350 million to $650 million over budget, the Bruce project seems to have even managed to dent Energy Minister Gerry Phillips' optimism about bringing new discipline and control to nuclear spending.

Of course, it is a bit difficult to enforce such discipline when the province agrees to pick up 25 to 75 per cent of cost overruns and to pay for 100 per cent of the multi-billion dollar expenses associated with that nasty nuclear waste the plant produces.

And it was all going to be different this time. Never again would we see a project like the Pickering Unit 4 refurbishment -- years late and hundreds of millions of dollars over budget. Unfortunately, despite assurances from Ontario Power Generation boss Jake Epp that the spruced up Pickering Unit 1 would have a capacity utilization rate of 85 per cent for the next 12 years, the reality is that this reactor operated at a dismal 38.9 per cent capacity utilization rate in 2007.

That's not exactly a great bargain for Ontario ratepayers, who are already stuck with paying off billions in nuclear debt -- a reality re-enforced monthly when you get your electricity bill.

But what is really hard to fathom is that while it is "damn the torpedoes" on nuclear spending, the attitude among Ontario's energy mandarins toward almost zero risk conservation and demand management programs is pretty much the exact opposite. For example, despite huge potential, the Ontario Power Authority (OPA), working with local utilities, has managed to get less than 2 per cent of potential participants to sign up for programs that turn down air conditioners in peak electricity demand periods.

While the sky's the limit on spending for nuclear power - the province has set a target of meeting up to 72 per cent of its electricity needs (on a total kilowatt hours-used basis) from nuclear -- demand management and clean power initiatives continue to be hamstrung by the OPA.

For example, the OPA has placed an arbitrary 30 megawatt cap on Rodan Energy's excellent demand-management program in northern York Region while simultaneously promoting the construction of a quarter-of-a-billion dollar power plant to meet the region's peak day electricity demand.

Then there is the freeze on new wind power projects along the Lake Huron shoreline to ensure that transmission lines are available to flow nuclear power to Toronto if those Bruce renos ever do get completed.

The premier and the minister of energy talk a great game when it comes to conservation and energy efficiency. The people of Ontario are more than ready to do their part. But when the government is driving, it is all one foot on the conservation brake and the other to the floor on nuclear.

This is puzzling since the international track record of conservation and demand-management programs is excellent. In fact, it is why many of our major competitors are so much more productive when it comes to electricity use than Ontario. Jurisdictions such as New York state and California see conservation and demand-management as "low hanging fruit" and have explicit policies to tap every kilowatt they can get from these sources before turning to new generation sources.

Ontario did not invent the peaksaver program or the concept of paying companies to reduce demand during peak periods. These programs have been in place and working in many U.S. states for years. But what we didn't copy was a clear mandate to put conservation first -- to harvest the low-hanging fruit before shopping for exotic imports. Simply put, you can't have a conservation culture if you don't make it more rewarding -- and easier -- to conserve energy than to build new power plants.

Where Ontario has been a leader is in committing to eliminate the use of dirty coal to produce electricity. This is an internationally important undertaking that has enormous climate ramifications.

The easiest way to ensure that we can act on our commitment is to ensure that we have done everything reasonable under the sun to reduce electricity use. By simply hooking up every residential and small commercial air conditioner in the province to a peaksaver device, for example, we could eliminate the need for half the power produced by the massive Nanticoke generating station. No cost overruns, no waste, small budget, huge impact -- what doesn't the government get about this?

It's time for Ontario to park its megaproject energy mentality and move into the modern age. We need leadership that believes in putting conservation and demand management first. We need leadership that grasps the potential of intelligent, distributed energy systems that avoid the mega-pitfalls of centralized generation.

We need leadership that understands that we can't continue to lag in energy productivity and compete in world markets. We need leadership that thinks action on climate change today matters.

Over to you, Premier McGuinty.

Jack Gibbons is chair of Ontario Clean Air Alliance.

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